The Home Loan Process Explained
Getting a home loan can be scary, and actually applying for one can be an intimidating rollercoaster of a journey.
Buying your first home is a big milestone. It requires a lot of time, effort, research, paperwork, and most importantly, money. There are a few things you’ll need to cover the costs for when buying your home.
When buying a home in the Philippines, your deposit size will vary depending on the type of property you’re purchasing, and it might vary slightly depending on the developer, as well.
A good down payment size is, on average, 20%. Some buildings may require anywhere from 10-30%.
There are a few ways you can determine how big your house deposit needs to be. The first way is to check with the developer, if you are buying a condominium. They are often willing to negotiate with buyers and can accept as little as a 5% deposit, with another 5% being paid in installments during the build.
If you are not buying a condo, you can check with your preferred bank their maximum loan amount. If they’re only willing to upfront 80% of the total property value, then you know you need a minimum of 20% for the deposit.
But just because the minimum deposit required is 20%, doesn’t mean it’s not a good idea to save more. Putting down a larger deposit means you save money on interest fees in the long term.
There are a lot of documents that need to be signed during the sales process, and they’re often glossed over as part of the buying process. The fees involved with buying a home are:
When applying for a loan with a big bank like BDO or BPI, they automatically include some insurance cover. However, this usually only lasts for about the first year, so it’s worthwhile looking into various insurances to protect your new home and save your family from incurring debt. A few examples of insurances out there include:
Plus more. There are many companies that offer comprehensive home insurance cover that you can look into. Find cover that suits your needs, and don’t pay for what you likely don’t need.
Big banks like BDO make insurance non-negotiable and include the cost of it in your monthly payments for 12 months. This means you don’t need to choose a provider for Credit Life Insurance or Fire Insurance. Similarly, BPI offers an All-In financing option that means some of the fees you’d usually have to pay for, from the processing section mentioned above, are included in your loan. This means less money you have to upfront.
Buying a house is wonderful, but as mentioned before, accidents happen. And sometimes they can happen sooner than you predict. An emergency fund is great for you to dip into when things break, because accidents do happen, and when you own your own home, there’s no one else to pay for it!
If you have a vision for your perfect home but weren’t able to find it on the market, renovations are a great way to make use of a home with a good floor plan already established. Adding on an extra room or two can not only increase the quality of your living, but it could also add value to your home! But renovations don’t come cheap, so you need to set money aside for it – and quickly, if you want to see your dream house built.
Alternatively, if you’re buying a home that has been foreclosed, it’s likely it’s been abandoned for quite some time. You will need to invest some cash to get it fresh, clean, and sparkling again.
Try to save 20% of your dream property’s selling price. Try to save more if you can for rainy days and broken hinges.
Your mortgage amortizations shouldn’t cost more than 30% of your monthly income, so you have a little wiggle room to make your savings grow once you’ve purchased your home.
Getting a home loan can be scary, and actually applying for one can be an intimidating rollercoaster of a journey.
What’s the one decision in home buying that could save you thousands or cost you dearly over the next 20 years? It’s choosing which bank to get your home loan from!
Finding a great bank is not just about low-interest rates. You also want a bank that treats you well and doesn’t hide their fees. So whether you’re buying a house for the first time or have done this before, we’ve got some great information for you.
Buying a home is an exciting milestone, but if you’re not careful, your home loan could end up costing you hundreds of thousands of pesos more than it needs to. Thankfully, with the right strategy, you can potentially save over 700,000 pesos—or even more—on your home. The secret? We’ll reveal that in this article.
If you’re planning to buy a home and need a loan, this article could literally save you hundreds of thousands over the life of your mortgage—so make sure to read through and bookmark it if needed!
Getting a home loan can be scary, and actually applying for one can be an intimidating rollercoaster of a journey.
What’s the one decision in home buying that could save you thousands or cost you dearly over the next 20 years? It’s choosing which bank to get your home loan from!
Finding a great bank is not just about low-interest rates. You also want a bank that treats you well and doesn’t hide their fees. So whether you’re buying a house for the first time or have done this before, we’ve got some great information for you.
Buying a home is an exciting milestone, but if you’re not careful, your home loan could end up costing you hundreds of thousands of pesos more than it needs to. Thankfully, with the right strategy, you can potentially save over 700,000 pesos—or even more—on your home. The secret? We’ll reveal that in this article.
If you’re planning to buy a home and need a loan, this article could literally save you hundreds of thousands over the life of your mortgage—so make sure to read through and bookmark it if needed!